All other things being equal, the lower the cost of doing business the greater the bottom line.
Previously, stockbroker commissions used to be linear – the bigger the transaction, the higher the cost. Today, they are under $10 regardless of the transaction size. Some investment banks don’t even charge commissions. They have many other ways of making money; please don’t worry about them.
One of the ways they have of making money is the bid/ask spread. All security transactions involve a market maker. An investor selling a security sells it to the market maker at the bid price. The market maker then sells it for a higher amount, the ask price, to another investor who wants to buy that security.
This is the bid/ask spread. Investors rarely look at the bid/ask spread, but it is a real cost.
Heavily traded securities have smaller bid/ask spreads than lightly traded securities. One of the advantages of the Monday Morning Program is that it encourages investors to buy an exchange-traded fund (ETF) which tracks the S&P 500 which itself tracks the American economy, the strongest in history. The most heavily traded of these is SPY; the bid ask/spread is often less than three cents per share. The others and many individual stocks are more lightly traded traded; the bid/ask spreads can be 20 times larger!
The Monday Morning Millionaire Program was designed to offer compressed investment convictions. Over the last two decades, the program has outperformed over 90% of portfolios including professionally managed ones.
The program does not provide any investment advice or endorsements.
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